Tesla Shares Hit Record on Optimism for Foreign Sales

Shares of Tesla Motors Inc., the youngest and smallest publicly traded U.S. automaker, rose to a record Monday after an analyst said investors anticipate that the electric-car maker will post favorable sales in China and Europe.

The shares gained 5.4 percent to $196.56 in New York, surpassing the previous record close of $193.37 on Sept. 30. Earlier in the day, the Palo Alto, California-based company’s stock reached an all-time intraday high of $199.30.

Elon Musk, Tesla’s billionaire chief executive officer, and JB Straubel, its chief technical officer, were in Europe briefing customers this month and the company’s plans for China are being well received, said Ben Kallo, a Robert W. Baird & Co. analyst in San Francisco. He rates the shares outperform.

“All the news following around Elon and JB Straubel kind of got it started, and all the positive news in China is also having a positive impact,” Kallo said in a phone interview today.

Tesla, which quadrupled in value last year, began rising again last month after the company said its shipments of Model S sedans in the fourth quarter of 2013 and revenue were 20 percent higher than it had expected. Musk also said in a January interview that China, where sales begin next month, may match U.S. volume as early as next year.

China confirmed Monday that electric-vehicle incentives will be higher in 2014 than previously announced as part of efforts to curb the nation’s worsening air pollution. While Tesla won’t qualify for the incentive program as an imported vehicle, the confirmation can be viewed a positive for the company, said Craig Irwin, an analyst at Wedbush Securities in New York.

China Incentives

Subsidies are being cut by only 5 percent this year, instead of an initial 10 percent target, and will be further decreased by 10 percent in 2015 instead of 20 percent, China’s finance ministry said in a joint statement with the National Development and Reform Commission, technology and industry ministries.

“The better-than-expected change in Chinese EV subsidies is helping the stock,” said Irwin, who rates Tesla outperfrom. “This doesn’t fundamentally impact Tesla, given they are not eligible for the subsidies yet, but is a headline positive.”

Tesla’s Model S will be priced from 734,000 yuan ($121,116) in China when deliveries begin, the company has said. That’s about 50 percent higher than the U.S. price to cover shipping costs, taxes and import duties that run as much as 25 percent, Musk said.

The company is scheduled to release fourth-quarter financial results on Feb. 19. Analysts on average estimate the company will post a profit, excluding some costs, of 18 cents a share, according to data compiled by Bloomberg. The net loss may narrow to $2.4 million, or 2 cents a share, while sales may more than double to $668.6 million.

Shares of Tesla Motors Inc., the youngest and smallest publicly traded U.S. automaker, rose to a record Monday after an analyst said investors anticipate that the electric-car maker will post favorable sales in China and Europe.